US Economic Outlook Recovery going from bad to worse Recent developments have only reinforced our long-held belief that the economic recovery will remain unusually lacklustre for several more years. We now expect GDP growth of just 1.5% in 2012 and 2.0%... 14th September 2011 · 1 min read
Canada Chart Pack Is the squeeze on real household income over? Real personal disposable income growth slowed to a snail pace during the first half of this year, depressing consumer spending in the process. Compared to a year ago, second-quarter real income... 13th September 2011 · 1 min read
Canada Economics Weekly Tightening financial conditions cast more doubt Judging by the declines in the Bank of Canada's Financial Conditions Index (FCI), financial conditions appear to have tightened recently, despite somewhat lower bond yields. Although the amount of... 13th September 2011 · 1 min read
US Economics Weekly Policymakers lay out the case for more action Policymakers were back in the spotlight last week, with hopes growing that we could now see further monetary and fiscal stimulus. Unfortunately, we doubt that the Fed will have much success with what... 13th September 2011 · 1 min read
Canada Data Response Labour Force Survey (Aug.) The drop in August employment was disappointing and points to modest growth in household spending this quarter. The only redeeming quality in the jobs report was the rotation from part-time to full... 10th September 2011 · 1 min read
US Economics Update American Jobs Act is big but politically polarising President Obama's newly proposed $450bn job creation bill is equivalent to nearly 3% of GDP, so if it was passed by Congress as it stands it would certainly have a significant impact on GDP growth in... 10th September 2011 · 1 min read
Canada Data Response International Merchandise Trade (Jul.) July's international trade data provides further evidence that the economy rebounded from the disappointing second-quarter contraction, growing by an estimated 2.5% annualised this quarter. Whether or... 9th September 2011 · 1 min read
US Data Response International Trade (Jul.) The sharp decline in the trade deficit in July is one more reason to believe that annualised third-quarter GDP growth will come in around 2.5%. With global demand clearly weakening, however, the... 9th September 2011 · 1 min read
Canada Economics Update The disappearing case for rate increases Considering the contraction in second-quarter GDP and evidence of slowing global economic growth and rising financial risks, it is not a surprise to anyone that the Bank of Canada kept its policy... 8th September 2011 · 1 min read
US Housing Market Data Response Mortgage Applications (Aug.) The latest mortgage applications figures illustrate how ultra-loose monetary policy is failing to boost economic activity. Despite the fall in 30-year mortgage rates to within a whisker of a record... 8th September 2011 · 1 min read
US Housing Market Update FHFA's new house price index still falls short The FHFA's new "expanded-data" house price index is better than its other indices as it includes some purchases made with cash and non-conforming loans. However, as it is still a less comprehensive... 7th September 2011 · 1 min read
Canada Economics Weekly What's all the fuss about real GDI? Most analysts agree that real Gross Domestic Income (GDI) is another useful indication of economic activity. For the purposes of monetary policy, however, what ultimately matters, more than any other... 6th September 2011 · 1 min read
US Economics Weekly Fed increasingly likely to launch Operation Twist On balance, we still think that the acceleration in core inflation will prevent the Fed from undertaking a third round of quantitative easing, even after the disappointing August payrolls figures. The... 6th September 2011 · 1 min read
US Data Response Employment Report (Aug.) Even after allowing for the disruption of the strike by 45,000 Verizon workers last month, the stagnation in payroll employment is an ominous sign. The monthly gain in payrolls has now been below 100... 3rd September 2011 · 1 min read
US Data Response ISM Manufacturing Index (Aug.) The marginal decline in the ISM manufacturing index to 50.6 in August, from 50.9, will further ease fears that the US economy is headed for a recession. At that level, the index is actually consistent... 2nd September 2011 · 1 min read
Bank of Canada Watch Bank's downside risks are being realised It is almost a foregone conclusion that the Bank of Canada will hold its policy interest rate at 1% next week. More importantly, considering the slight contraction in second-quarter GDP and evidence... 2nd September 2011 · 1 min read
